Despite Troubles, Family Carries On Peterson Legacy

by Serenah McKay  on Monday, Jun. 25, 2012 12:00 am  

That July, former employees filed a class-action suit in federal court against the holding company, directors and trustees of its employee stock ownership plan. The workers had held about 18.03 percent of the bank's shares in the plan.

The suit said the defendants "knew or should have known that the stock was an imprudent investment because ANB Financial was engaged in unsafe and unsound banking practices" and misrepresented the value of the stock to employees.

A settlement signed last October established a $2 million fund to pay the plaintiffs' court costs and other fees, with the rest to go into the employee plan. In return, the plaintiffs released all claims against the defendants.
 
More Banking Woes

In November, the FDIC ordered Decatur State Bank to reserve an additional $6.13 million to cover possible loan losses and shore up its capital.

The bank, which has offices in Decatur, Gentry and Siloam Springs, reduced its assets by about 20 percent during 2011 and followed last year's $12.7 million loss with a $1 million loss in the first quarter of 2012.

"While the bank does have some acknowledged asset quality challenges coming out of the last few recessionary years, we are obviously confident these problems can be remedied over the next couple years," Sam Mathias said in a news release announcing the purchase agreement.

"The bank has a good staff which we intend to keep intact to continue the efforts already set in motion to return the bank to a satisfactory and profitable condition."

Arkansas Business, citing the Federal Reserve Bank in St. Louis, recently reported the proposal involves buying out Decatur State Bank's shareholders for $2 million.
That deal is contingent upon the bank maintaining minimum equity capital of $6.5 million when the deal closes during the third quarter.

Debra Evans, as family trustee, controls at least 95 percent of the stock in Peterson Holding Co., Arkansas Business reported.

But if the bank's capital is below $4.5 million at the time of closing, "no cash consideration will be paid at closing," MBI stated in regulatory paperwork regarding the transaction.

Decatur State Bank reported equity capital of less than $5.4 million and total assets of $146.4 million as of March 31.

The agreement also entails rebuilding the Decatur bank's depleted capital through a $10 million loan from Chambers Bank of Danville and a $4 million special dividend from First State Bank of Northwest Arkansas, Mathias Bancshares' Huntsville-based bank.

 

 

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